Monday, July 02, 2018

Harley-Davidson and other tariff hypocrites

In addition to being an obscene poison pen writer, Kevin D. Williamson is sloppy. He penned an ode to Harley-Davidson because it is standing up to "The Man" by shipping more production overseas to protest President Trump's tariffs.

Williamson missed the real story. Harley-Davidson owes its existence to tariffs imposed by President Reagan in 1983. Ingratitude is hard to see when you are a Never Trumper basking in the glow of conservative victories that President Trump earned.

Given that Williamson was only 11 in 1983 (and I was a mere 30), I shall try to enlighten him on how Reagan saved Harley-Davidson.

"The impact of Mr. Reagan's action, which followed the unanimous recommendation of his trade advisers, is effectively limited to Japanese manufacturers, which dominate every sector of the American motorcycle market.

"The action was exceptional for protecting a single American company, the Harley-Davidson Motor Company of Milwaukee, the sole surviving American maker of motorcycles."

The Japanese had captured 80 percent of the U.S. market for "heavyweight motorcycle."

Four years after Reagan raised tenfold the tariff on that particular sized motorcycle to protect one company from folding, he spoke at its plant in York, Pennsylvania.

"Well, after being shown around this plant, it seems to me I've come to hog heaven. One thing's for sure: When it comes to motorcycles, this is the home of the all-American A-team" Reagan said.

"Of course, that's not what a lot of people were saying about you just a few years ago. Some people said that you couldn't make the grade. They said you couldn't keep up with foreign competition. They said that Harley-Davidson was running out of gas and sputtering to a stop.

"Well, the people who say that American workers and American companies can't compete are making one of the oldest mistakes in the world. They're betting against America itself, and that's one bet no one will ever win.

"You know, those people who place their bets on someone other than you is a little bit like the fellow that was going to the races. And for three nights he dreamed of the number five. So, when he got to the track, he opened a program to the fifth race, and he looked down to the number five horse. And the horse's name was Five-by-Five. Well, that did it. He bet the whole bundle on that horse, number five in the fifth race, and the horse came in fifth."

Harley now has plants all over the world. Harley, Williamson and the National Review ignored Reagan's actions and words. They bet against America. They call it free trade, but given the low wages paid in Thailand, where Harley is building a plant, maybe we should call it slave trade.

Reading Williamson, Reagan would have sighed, and replied, "The Harley-Davidson example makes a very strong statement about how government, through the judicious application of our trade laws, can help the best and the brightest in American management and labor come together in ways that will create new jobs, new growth, and new prosperity.

"Government's role, particularly on the trade front, should be one of creating the conditions where fair trade will flourish, and this is precisely what has been done here. Our trade laws should work to foster growth and trade, not shut it off. And that's what's at the heart of our fair trade policy: opening foreign markets, not closing ours.

"Where U.S. firms have suffered from temporary surges in foreign competition, we haven't been shy about using our import laws to produce temporary relief. Now, there are those in Congress who say our trade policies haven't worked, but you here at Harley-Davidson are living proof that our laws are working. The idea of going to mandatory retaliation and shutting down on Presidential discretion in enforcing our trade laws is moving toward a policy that invites, even encourages, trade wars. It's time to work to expand the world market, not restrict it."

As long as Harley's manufactured overseas are sold overseas, I am ok (i dont feel informed because regardless of how much i read, the media omit so much info, it can be impossible to be informed)..If Harley Intends to ship bikes made overseas ti the US, they should face the same tarriffs as international manufacturers

That's how it struck me as well. Also, in 1983 Harley-Davidson was just getting out from under over ten years of terrible management by AMF. The tariffs gave them the breathing space they needed to get back on track. - Elric